lets-retire-- Thanks for the info. Gives me something to think about. As far as you saying you live in a high property tax state and paid 2000/yr for a 145,000 house. The condo I was looking at was going for 85,000 and property taxes were 1850/yr. Association fees are almost 150/mo. In Wisconsin, heating bills can sometimes top 200/mo. At least insurance is only about 300/yr.

TomSimpsonAZ-- You could look up Appleton or Oshkosh Wisconsin. Thanks.

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That heating bill a oil or gas fired furnace? I've never had one of those. Mine has always been electric. Dang those are high property taxes, but on the better side buying a place would allow you to write off those as well as your state income taxes. Currently your landlord writes off the property tax and you pay for it. Personally I hate write offs. They mean I had to spend a dollar to receive .10, but I can't afford to pay for the house in cash so at least it eases the pain.

Do they include the insurance on the structure in you association fees? They do here, so if you decide to buy insurance it's only for contents. That is a lot cheaper.

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You don't want to work. You want to live like a king, but the big bad world don't owe you a thing. Get over it--The Eagles

I believe that would be a gas fired furnace. I was a little high on the taxes that I mentioned earlier. I was going off memory. It's actually about 1675/yr... still a lot on a $85,000 condo. Unsure about the insurance being included in the association fees.

Aaron, I looked up some houses in Oshkosh and came up with these.* I'm basically in your exact same situation making 45k a year and I'm 24.* I've been slowly going from 12k to 45k over the last 4 years, so I've always sort of budgeted low.* I bought my first house on 9 bucks an hour and had 3 roommates! It sucked, but it has helped tremendously in the long run.* Anyways, looking to spend 400 to 500 a month out of your own pocket would leave you with 800-1000 a month for a house if you had 1 roommate and probably 1200-1500 if you had 2 roommates.* So, with this in mind, you probably have around 120k to spend on a house, give or take 20k.* So, lets look for houses with 3 bedrooms in that area.

All of these homes are going to cost below 600 in mortgage and with tax, title, insurance, etc will be around 700, figure in about 300 in utilities and you're at 1000 a month.* If you finance it 100% you'll be at 1100 a month or something, whatever.

Granted homeowning is a pain in the ass and stuff breaks, which is always annoying.* You'll be able to spend your younger years with a couple of roommates who are basically paying your mortgage for you and you'll have a very nice tax deduction which you really need at 43k.* Figure paying 6k in interest per year(well, your roommates are actually paying it) and then you'll get back 30% of it come tax time.*

So, two roommates at 400/mo util incl(collecting rent and then splitting utilities sucks ass, just include them, the fewer times a month you have to ask for money the better)

800 rent + 400 you = 1200 mo

You put in 400/mo just like now, but you get the principle that gets paid down over time, 1800/yr back from taxes, and you don't have to live in an apartment.

The first couple of years you'll only make like 2k in principle so 2k + 1800 = 3800 bucks for your troubles, which isn't much, but it is something.* After 5 years it starts to change dramatically and there is one more thing.....the damn thing just might appreciate a little, but never count on that, not in the midwest.

IMHO, finance a house with as little money out of pocket as possible, but get nice fixed loans. Think of it as diversifying your portfolio which is already rich with money that will have lots of time to build on itself if it is uninterrupted for the next 25 years, so don't set yourself up to have to pull a big chunk out of your 401k because you're getting your first house at 35. Make some sacrifices now and the house basically pays for itself, by 35 you have your down payment on your first house already paid from years of hard work.

Also remember that you have the option of renting the house out later on in life and letting it pay itself off someday, creating a nice positive cash flow to help pay for your bigger and better house for you and your family.

There is no right or wrong to this; just what works for you in the current stage of your financial life.

Speaking of RE taxes. When I lived in northern IL, my property taxes on a $350k house were $11k per year. Ouch!
Where I live now the taxes are not as bad but still high. I now have more house but half the taxes.

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